I am still in a state of shock over Tuesday’s election results. Never in a million years could I even conceive of Trump winning the election. It was worrisome enough that he had been steadily polling at over 40% support for some weeks. That alone I found incredible.

It was like the entire country was oblivious to Trump’s true character, his erratic conduct, his inflated ego, his dangerous demagoguery, his racist and misogynistic views, his record as a sexual predator, his dishonest business dealings, his personal vindictiveness, and his steady stream of lies. The false equivalence between his public record and that of Hillary Clinton was, to me, astounding and quite unbelievable.

But it has actually happened. The first African-American president has been succeeded by a candidate endorsed by the KKK. Incredible! David Duke, a former KKK Grand Wizard, tweeted out, “This is one of the most exciting nights of my life. Make no mistake about it, our people have played a huge roll in electing Trump.”

One of the first congratulatory messages from a foreign leader came from Marine LePen, leader of France’s far-right National Front. Vladimir Putin was also quick to applauded Trump’s win. And, perhaps most disturbing, it was welcomed by Al-Qaeda and Egyptian Jihadis. “Trump’s victory is a hard slap to those promoting the efficiency of democratic systems,” the spokesperson for the Syrian affiliate of Al-Qaeda, tweeted. “Starting today we won’t need media releases clarifying the West’s machinations, All we need to do is retweet what Trump says.”

Thousands of protesters have since taken to the streets in many American cities to protest Trump’s election, shouting “He’s not my president.”

I have spent much of the past day sifting through various media reports on the election results, trying to understand what has just happened. I find that international commentary provides a much better perspective on Trump’s victory than most of what comes out of the U.S. right now. (Americans are notoriously blind to the international implications of their actions.)

It turns out that my own thoughts are quite accurately expressed in the following strongly worded article in Wednesday’s Guardian from England:

We thought the United States would step back from the abyss. We believed, and the polls led us to feel sure, that Americans would not, in the end, hand the most powerful office on earth to an unstable bigot, sexual predator and compulsive liar.

People all around the world had watched and waited, through the consecutive horrors of the 2016 election campaign, believing the Trump nightmare would eventually pass. But today the United States – the country that had, from its birth, seen itself as a beacon that would inspire the world, a society that praised itself as “the last best hope of earth”, the nation that had seemed to be bending the arc of history towards justice, as Barack Obama so memorably put it on this same morning eight years ago – has stepped into the abyss.

Today the United States stands not as a source of inspiration to the rest of the world but as a source of fear. Instead of hailing its first female president, it seems poised to hand the awesome power of its highest office to a man who revels in his own ignorance, racism and misogyny. One who knows him well describes him as a dangerous“sociopath”.

And what awesome power he will soon have. Republicans did not just defy almost every projection, prediction and data-rich computer model to win the presidency. They also won the House of Representatives and much of the Senate. Trump will face few checks on his whims. A man with no control of his impulses will be unrestrained, the might of a superpower at the service of his ego and his id. …

The most obvious impact will be on the country he will soon rule. Just think of what he has promised. A deportation force to round up and expel the 11 million undocumented migrants who make up 6% of the US workforce. A ban on all Muslims entering the country, later downgraded to a pledge to impose “extreme vetting” on anyone coming from a suspect land. A giant wall to seal off the Mexican border. “Some form of punishment” for women who seek an abortion. And prison for the woman he just defeated.

This will be America’s ordeal primarily. But it will affect all of us. A reality TV star with no experience of either politics or the military will have the nuclear button as his toy. This, remember, is the man who reportedly asked several times, during a military briefing, why the US didn’t use nuclear weapons since it had them. This is the man who has said “I love war”. Whose proposed solution to Isis is “to bomb the shit out of them” and steal the oil.

Think of the anxiety this morning in Riga, Vilnius or Tallinn. In the summer, Trump told the New York Timeshe did not believe in Nato’s core principle: that an attack on one member should be met by a response from all. He seemed to see Nato as a mafia protection racket: unless the little guys paid up, they should be left undefended. Vladimir Putin – Trump’s hero, admired as the very model of a leader by the president-elect of the United States – will not need more of a hint than that. The Russian dictator will surely see his opportunity to invade one or more Baltic states and expand his empire. … A trade war looms with China, the imposition of tariffs that could imperil the entire global trading system. America is about to turn inward, towards protectionism. …

And what about our planet? Trump believes climate change is a hoax perpetrated by the Chinese. He will do nothing to reduce emissions: he does not believe they exist.

But beyond all that, there is another consequence of this terrifying decision, no less dark. Trump’s success has delighted white nationalists and racists in his own country and beyond. His victories in the key battleground states were hailed by David Duke, a former luminary of the Ku Klux Klan:“God Bless Donald Trump,” he tweeted. “It’s TIME TO TAKE AMERICA BACK.” The Dutch nationalist Geert Wilders was in similarly cheery mood: “The people are taking their country back,” he said, “So will we.” Marine Le Pen will feel the same jubilation, as will every other populist or nationalist who traffics in hate.

The most powerful country in the world is to be led by its most dangerous ever leader … [FDR] once told Americans they had “nothing to fear but fear itself”. That is not true today. America and the rest of us have plenty to fear – starting with the man who now stands on top of the world.

The best American commentary I have found comes from Ezra Klein, writing on Wednesday for Vox. He, I think, provides a very realistic view of Trump’s impulses, but also the limits to his power. And he provides some very sound advice for the Republican Congress as they try to work constructively with Trump.

Donald Trump has won the election. Now it is up to America’s institutions, and the people within them, to check his worst instincts.

There is danger in Trump. He’s a man with authoritarian impulses, a conspiracy theorist’s bent, and a taste for vengeance. He has an alarming temperament, little impulse control, and less decency. He has a demagogue’s instinct for finding enemies and a bully’s instinct for finding their weaknesses. He is uninterested in policy, unrestrained by shame, and unbound by norms. He surrounds himself with sycophants and enablers, and he believes both the facts and the falsehoods he finds congenial.

But he is entering an office that is weaker than many realize. For all the same reasons Barack Obama could not bring about the change he had made people believe in, Trump cannot wrench America to his vision of greatness. He is constrained by the House and the Senate, by the Supreme Court, by the executive agencies, and — in ways less formal but no less powerful — by his own staff and party.

There would be more comfort in this if there were more opposition inside these institutions. But Republicans control everything — the House, the Senate, and, after an appointment, the Supreme Court. If Trump is to be checked, it will be because his own party checks him.

So far, the GOP has not shown much interest or ability in standing up to their standard-bearer. Top Republicans closed ranks around Trump despite believing him fundamentally unfit for office. Their embrace did not, however, lead to Trump surrounding himself with more professional staff, developing sounder policy, or moderating his worst instincts.

Already, the Trump campaign has leakedthat they will fill their administration with the most supportive staff they can find, not the best. But the number of jobs they appear to have candidates for is slim. They will need many more bodies to fill both the White House and the executive agencies. This is a place where the Republican Party could potentially play a role in surrounding Trump with calmer, wiser advisers who could provide him better information and curb his worst impulses. …

House and Senate Republicans know that Trump’s success is their success, that his strength is their strength. The same goes for his staff, and his appointees. The question is whether they can structure a version of success for him that keeps the country safe, and whether they will be willing, if the worst comes to pass, to cross their president for their country.

If there is hope, it is here: The incentives of governance are different from the incentives of opposition. The Republican majority will have to face the voters in 2018, and then again in 2020. If they have taken health insurance from tens of millions of people without replacement, if they have ripped open families and communities with indiscriminate deportation, if they have embroiled us in disastrous wars or confrontations, if they have sent the economy into tailspin, those elections will not be pleasant.

Perhaps this is a weight Trump will feel in a way he has not over the course of the campaign, and he will change his behavior accordingly. But even if he doesn’t, Republicans have a majority, and it will be one they hope to keep. To keep it, they will need to govern well, or at least convince the electorate they have governed well. And to govern well, they will need to keep Trump’s worst tendencies in check. Now we see how strong the American system really is.

Klein’s article pushes a bit beyond the limits of my own optimism. I do not see the Congress successfully reigning in Trump. On some legislative matters he will not care what they do, and may gladly sign their legislation into law. But on other matters I expect there to be a real confrontation. Donald Trump has promised a better health care plan for everyone, massive spending on infrastructure, a return of good-paying jobs, and massive increases in military spending. In other words, a return to (or continuation of) big government spending.

But Congress controls the purse strings, and one would expect the Republican-led Congress to insist on reducing government expenditures, having even lower taxes, and keeping a lid on the deficit. The next vote on the debt ceiling is scheduled for March 17, 2017, just two months into Trump’s term. It should prove interesting and quite revealing to see which side will yield on these expenditure issues.

My guess is that Donald Trump is so inexperienced in the ways of politics and completely resistant to following the advice of others, that he will quickly make some major missteps. When called on it, he will place the blame on others. If challenged, he will lash out against any who defy him. That is his nature. That is how he acts.

Donald Trump already has a number of opponents within the Republican Party. There are many who accuse him of not being a ‘true’ Republican. (He was a registered Democrat, then an Independent, before running for president under the Republican banner.) Will one see a widening fissure along ideological lines? Or will it simply become an open contest for power? Politics is all about power, after all. And in the end, which faction will emerge as the true standard-bearer of Republican values? It’s all up for grabs. Expect to see your idea of Republicanism become radically redefined.

More importantly, what will happen in 2 years’ time when the multitudes of the anger-filled supporters who put Donald Trump in the White House to “make America great again” find that he has accomplished little to make their situation better? Who will be blamed for his unfilled promises – Trump himself or the Republican members of Congress? As Ezra Klein says in his article,

The Republican majority will have to face the voters in 2018, and then again in 2020. If they have taken health insurance from tens of millions of people without replacement, if they have ripped open families and communities with indiscriminate deportation, if they have embroiled us in disastrous wars or confrontations, if they have sent the economy into tailspin, those elections will not be pleasant.

It looks very much like a lose-lose situation, and all parties are going to have to tread very carefully to avoid another angry revolt by the electorate against those currently in office. The new Republican hegemony could end up being very short lived.

This is far from over. In fact, the next stage of massive voter alienation is just getting underway. Trump has made too many grand promises and raised expectations far too high for him to get away with backing out of them now. I predict that it will not end well.

Mind you, this is not just going to be a problem for Republicans. As Aaron Blake noted in Wednesday’s Washington Post, with Hillary Clinton’s loss, the Democrats are now a party without a leader or direction, and will have to work hard to redefine themselves before turning to the voters again for support. I expect to see a contest between ‘establishment’ figures and the progressives within the Democratic Party emerging by the 2018 midterm election that will be much more intense than the one in the recent primary campaign. And by 2020 it may be in full force – a counterpart to the newly radicalized ‘non-establishment’ faction that helped put Donald Trump in office.

Tuesday was quite the decisive day in American politics. Not only did Donald Trump win big in the Indiana Primary, but Ted Cruz also finally threw in the towel and suspended his presidential campaign. Today John Kasich is reported to be withdrawing from the race as well, leaving Trump in an uncontested position for the Republican nomination.

What Paul Krugman calls “Movement Conservatives” – those who support the increasingly right-wing trajectory of American conservative policy from Barry Goldwater’s run for the presidency in 1964 through the Reagan presidency of the 1980s and on through the Tea Party era – these “true” conservatives must be shaking their heads in disbelief now that Ted Cruz, their last standard-bearer of conservative ideology, has given up the fight in this year’s presidential race.

In one audacious and masterfully crafted campaign Donald Trump has single-handedly swept aside the carefully constructed coalition of conservative interests that have defined Republican ideology for the past 40 years. The prevailing Republican strategy since the Nixon presidency has been to craft an alliance between a hard-core anticommunist faction, those opposed to new civil rights legislation, and those promoting a governmental “hands off” approach to economics.

This “three-legged stool” of core Republican principles, as Josh Barro refers to them, namely militarism, social conservatism and libertarian economics, has now been replaced by Trump’s inflammatory rhetoric focusing on immigrants, Muslims, and the very rich.

Trump’s rejection of traditional Republican ideology in his campaign is remarkable. With regard to America’s military policies, Trump has denounced G. W. Bush’s war in Iraq, and called into question America’s continuing support for NATO. In a recent speech laying out his vision for America’s role in the world Trump decried what he called “the dangerous idea that we could make western democracies out of countries that had no experience or interest in becoming a western democracy.”

On social issues Trump long ago carved out a liberal position that strongly departs from official Republican policy. In 1999 he stated on Meet the Press that he was “very pro-choice” and the same year he stated in an interview with Larry King that he was “very liberal when it comes to health care” and that he believed in “universal healthcare.”

In a major departure from traditional Republican economic policy, Trump has argued that the wealthy get too many tax breaks and they should be required to pay more. He has denounced America’s international trade agreements, which he claims have not created more jobs for Americans but taken them away. He has defended existing social entitlements and has pledged to leave Social Security Medicare and Medicaid benefits intact.

Donald Trump has repudiated a slew of core Republican policies and harshly criticized the Republican National Committee itself. He has thumbed his nose at attempts within to RCN to deny him the party’s candidacy, and in all of this he has prevailed.

The question now is, with Trump poised to claim the Republican Party nomination at its upcoming convention, will the party establishment come around to aligning itself with Donald Trump? Trump has emerged as a polarizing figure both within and beyond the Republican Party. Polls show that fully two-thirds of Americans give him an unfavorable rating, a number that has “no equal among major party nominees in presidential campaigns over the last 23 years.” And so, if Trump loses badly in this fall’s election (as many expect will happen) will the party itself lose credibility in aligning itself with him and his nonconformist policies?

A new reality has now dawned for the Republican Party: In consolidating his standing as the sole remaining party candidate as an outlier, Donald Trump is well on his way to overseeing the destruction of the Republican brand and, some contend, possibly the destruction of the Republican Party itself.

And so far Republican insiders have been able to do nothing to stop it.

Just when you thought the American political scene couldn’t get any more contentious, hostilities have suddenly broken out over a brand new issue. The unexpected death of U. S. Supreme Court Justice Antonin Scalia over the weekend has thrown Washington into complete uproar.

Until this week one might occasionally hear mention of the fact that, considering the ages of the current members of the Supreme Court, the next president will quite possibly end up nominating two (or even more) new justices during their term of office. That is significant. Since the justices serve for life, these appointments could determine which way the Court leans for an entire generation.

But it was a distant possibility set within a vague time frame. Political watchers on both the conservative and liberal sides were aware of its importance, but it did not gain much public attention.

Now the choice of the next Supreme Court Justice has suddenly become an urgent matter. Everyone is talking about it and speculating about what will happen next.

Of course Republicans don’t want Obama to choose Scalia’s replacement. The addition of a liberal member to the Court would reverse the present 5-4 conservative split. It would prove disastrous to conservative hopes to use the Court to overturn Obama’s executive actions and rule in favor of conservatives on other matters.

Republicans are pinning their hopes on 1) delaying the appointment until after Obama is out of office, 2) winning the Presidency, and 3) retaining their majority in the Senate. That’s a big call. Should they fail to achieve any one of these objectives, their plans will be sunk. On the other hand, if the Democrats win the Presidency and the Senate (it only takes winning four seats), it will mean no possibility of turning back their suspected liberal agenda. So the stakes are certainly quite high.

But there are a few facts that must be kept in mind. First, the President has a constitutional duty (under Article II, Section 2) to nominate a new appointee to the bench to fill any vacancy. That is usually done within 60 to 90 days. For President Obama not to try and fill the vacancy would be a dereliction of duty.

Second, under the same constitutional article, the Senate has a duty to give its “advice and consent” for the nominee, after which the appointment can proceed. The Senate is not obliged to consent to every nominee, but they are obliged to review and advise the president on the nominee’s worthiness. They can reject the nominee. But for them to refuse to hold a hearing would likewise be a dereliction of duty.

Third, there is no justification for the argument that President Obama should not put forward a nomination since he is a “lame duck” in his last year in office. On no less than seven occasions during the 20th century a Supreme Court position became vacant (either through death, retirement, or resignation) during a president’s final year in office. In each instance, the president put forward a nominee to fill the vacancy, and most of the time that vacancy was filled.

The only time it was not filled was late in Eisenhower’s last year of office and Congress had already adjourned. Eisenhower made an interim appointment, which was quickly ratified by the next session of Congress.

It should also be remembered that President Ronald Reagan nominated Anthony Kennedy to fill a vacancy on the bench during his final year in office, and the Democratic-controlled Senate confirmed Kennedy by a vote of 97 to 0.

One has to go all the way back to the Civil War to find a time when a President left a Supreme Court position vacant for an entire year – and that was because the nation was … well, in the midst of a civil war.

President Obama has already announced that, in keeping with his constitutional duty, he intends to put forward a nominee to replace Scalia. According to the commentators, he has two main courses of action.

First, he can choose a nominee who, political posturing aside, everyone should be able to agree to. He could, for example, choose someone who was previously confirmed unanimously to a lower court position by the Senate. One name that keeps appearing in this regard is Sri Srinivasan, who has no political ax to grind, has worked for both the Bush and Obama administrations, and is seen as a brilliant jurist. Even Ted Cruz has called him “a longtime friend.” It would be awkward for the same Republican members of the Senate who confirmed him without hesitation to the D.C. Circuit Court in 2013 to now label him as unsuitable.

The second option would be for Obama make a more contentious nomination, but one that would cost Republicans dearly in opposing during the presidential election campaign. The current Attorney General Loretta Lynch is frequently mentioned as one such candidate. She has outstanding qualifications as a prosecutor, and was recently successfully vetted by the Senate to become Attorney General. Should she as a woman and as an African-American be rejected by Republicans it could mean voters from both these demographic groups turning against Republicans and rallying to the side of the Democrats in the election this fall.

Or, in an even more pointed maneuver, Obama could nominate Mariano-Florentino [Tino] Cuéllar, a brilliant young Latino man who is an Associate Justice on California’s State Supreme Court. He was born in Mexico, but is a naturalized U.S. citizen. His perspective on immigration issues would be unique, and if Republicans should reject him for the Supreme Court it could alienate a vast swath of American Latino voters.

Who will Obama choose as his nominee? It’s anyone’s guess at this point. Will he try to find an acceptable moderate candidate, or act in a more politically partisan way? Perhaps that is not the most important issue.

What really counts now is how the Republican majority in the Senate will react. If it becomes clear that they are going to block any nominee that Obama puts forward, it will further polarize the American public, and may well mobilize Democrats and independents to show up at the polls and ensure that Republican attempts to control the nomination process ultimately fail.

In the meantime, The Supreme Court will be hamstrung with only eight members in a 4 to 4 liberal-conservative split for at least a year. National policy will fragment on a number of important issues such as immigration, abortion, birth control, unions, affirmative action and voter rights, as lower appeal courts decide on differing policies in their separate jurisdictions with no way of resolving these issues at the national level.

The crisis of a Congress that is incapable of doing its job will have spread to the Supreme Court, and the public will be in an angrier and more surly mood than ever.

I have a feeling that this is not going to end well … or quickly. This election is suddenly a whole new ballgame.

What should one make of President Obama’s latest State of the Union Address? On the one hand it’s easy to dismiss it as being mere words, nicely spoken but without any real import. After all, there’s virtually no chance of the policies he proposed being put into law by the current Republican dominated Congress.

But his speech was not about specific proposals that he wanted Congress to pass. It was about something else; it was about securing his legacy, and about fundamentally changing the course of future public policy in America.

We are fifteen years into this new century. Fifteen years that dawned with terror touching our shores; that unfolded with a new generation fighting two long and costly wars; that saw a vicious recession spread across our nation and the world. It has been, and still is, a hard time for many.

But tonight, we turn the page.

Tonight, after a breakthrough year for America, our economy is growing and creating jobs at the fastest pace since 1999. Our unemployment rate is now lower than it was before the financial crisis. More of our kids are graduating than ever before; more of our people are insured than ever before; we are as free from the grip of foreign oil as we’ve been in almost 30 years. …

At this moment – with a growing economy, shrinking deficits, bustling industry, and booming energy production – we have risen from recession freer to write our own future than any other nation on Earth. It’s now up to us to choose who we want to be over the next fifteen years, and for decades to come. [emphasis added]

Barack Obama has guided and overseen a dramatic period of change in America’s history that few presidents have witnessed. He will be remembered as the President who took office at a time when the country was teetering on the brink of financial collapse, the country’s largest financial institutions were insolvent, the auto industry was in ruins, millions of people had lost their jobs, and the national debt had soared to unbelievable levels. (Thank you George W. Bush.)

And what action did he take as president? With a Democratic majority in Congress helping him, in his first year in office, Obama

rescued the automobile companies, jump-started the renewable energy industry, imposed new rules on financial institutions and, most dramatically, engineered a major overhaul of the health care system.

That is no small feat. Furthermore,

On his own initiative [through executive action], he ordered major reforms in immigration policy, forged a landmark agreement with the automobile companies on fuel efficiency and proposed tough restrictions on greenhouse gas emissions from power plants.

That’s quite the legacy in just his first two years in office.

After the 2010 elections, when Democrats lost their majority in the House, Obama was not able to accomplish as much. In fact, thanks to an unrelenting onslaught of opposition from the Republican dominated House (invigorated by the Tea Party) he was put on the defensive, trying to simply retain what he had accomplished in his first two years.

No provocative new initiatives were forthcoming in his 2012 re-election campaign, as he appealed to the moderate middle ground of voters. In the 2014 midterm elections he also held back, trying (largely unsuccessfully) to protect Democrats up for re-election in red states.

But since then – with no more election campaigns ahead of him – Obama has gone on the offensive once more. He has in short order announced a new climate deal with China (demolishing the long standing objection that America can’t afford to curb emissions as long as China refuses do the same), entered into talks with Iran to curb their development of nuclear weapons, revealed extensive new immigration reforms, and (after 50 years of a failed embargo policy) begun normalizing diplomatic relations with Cuba.

Obama is determined to leave a legacy behind that will mark him as a real and effective change maker.

Establishing His Legacy

In emerging from the financial crisis, the road to financial recovery was agonizingly slow, hampered in great part by Republican refusal to approve spending initiatives to create new jobs in repairing a deteriorating infrastructure, developing new avenues of renewable energy, and investing in public education.

Instead, Republicans promoted an austerity program of decreased government spending, severe cutbacks in social services to the needy, and continued tax cuts to the wealthy. The U.S. would have come out of its deep recession much sooner and much more robustly if Congress had backed increased social expenditures rather than austerity.

It was almost as if the Republicans wanted to make people more miserable and more desperate in hopes that the economic recovery would fail and people would take their anger and frustration out on the president. It was a cynical strategy, but effective – and it almost worked.

Even within these constraints, the economy did recover – slowly and painfully while at every turn Republicans gleefully pointed to the continuing high unemployment rate and slow growth in the GDP. But over time the unemployment rate did come down, and the GDP did rise. Now Obama can point to the lowest unemployment rate since before the great recession, and the greatest number of jobs created under any presidency. The stock markets have doubled, economic expansion is now roaring ahead at 5%, and oil prices have been cut in half. The annual deficit has been cut by more than half since Obama took office, and the national debt is now safely under 3% of GDP – right where economists said it should be to get things back to normal.

Is Barack Obama single-handedly responsible for this dramatic turn-around. Of course not. But you know who will get the credit? He will. When people look back in future decades to those frightful days of the second “Great Depression,” they will forget the complexities of all the political infighting, the obstructionism of Congress, the painful sequester forced on the nation, and all the rest.

People will simply remember Obama as the president who pulled the country out of its economic free-fall, who put America back to work, who ended two ill-conceived wars that cost thousands of American lives, who broke the political impasse on immigration, who restored America’s reputation on the international stage, who created the path to energy self-sufficiency, and who (after 40 years of failed attempts by other administrations) finally implemented national health care.

Defining the Road Ahead

And now Obama is setting the tone for future public policy in America. The points he outlined in his speech are not policies that he hopes will be enacted by this session of Congress. They look beyond that. They form the framework for a national debate in preparation for the 2016 presidential election.

It is an agenda that Democrats can readily endorse – expanded opportunities for the middle class with the very wealthy paying more of their fair share. Can Republicans embrace such a platform? And if they campaign against it, does that make them the party that only defends the interests of the rich and powerful and doesn’t care about the majority of middle-class Americans? That’s going to prove awkward.

What if Republicans are forced to change their message and (heaven forbid, move leftward) to embrace more progressive social and economic policies?

Following Obama’s speech Brian Beutler penned a very insightful piece for the New Republic. He recalled how back in 2008 Obama told the editorial board of the Reno Gazette-Journal that,

Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not.

Beutler maintains that Obama wants to accomplish the same thing – to change the trajectory of America like Reagan did, but in the opposite direction.

This can be seen in Obama’s State of the Union Address. Barely into the speech Obama recounts that

Six years ago today, in the darkest months of the crisis … I stood on the steps of this Capitol and promised we would rebuild our economy on a new foundation.

After reciting a number of his economic initiatives and their success, he concludes by saying,

The verdict is clear. Middle-class economics works. [emphasis added]

The phrase “middle-class” economics is new. We have not heard it before. It is meant to signify the opposite of Ronald Reagan’s famous theory of “supply side” economics that focuses on increasing benefits for the wealthy in the belief that they will then create more jobs with their wealth, and the economic benefits will “trickle down” to those below.

Thirty years of economic history have shown that supply-side economics is a bust. The rich have simply pocketed their gains and the middle class has not benefited at all. George W. Bush’s naïve belief that providing further tax cuts for the rich would stimulate the economy has been shown to be completely ineffectual.

Obama is calling for an alternate strategy, one that focuses on providing benefits directly to the middle class to stimulate the economy.

It is an established fact that 70% of the economy rests on consumerism. When consumers have disposable income they will spend it on needed (and desired) goods and services. They will stimulate the economy. They will not hoard the money away like the rich, benefitting no one but themselves. They will not place it in offshore tax havens. And they will pay their fair share of taxes, unlike the super-wealthy who employ a raft of tax loopholes to avoid paying their fair share.

“Middle class economics” means investing in policies that stimulate middle class earnings so that they have disposable income to inject back into the economy. It means raising the minimum wage to a level where “the working poor” can actually live off their income and not be dependent on government supplements to survive.

It means providing equal pay for women. It means better early education and better skills training for better jobs. It means increased child support for working parents. It means having access to unemployment insurance and job retraining when necessary. And it means having health insurance coverage to protect from catastrophic financial loss due to illness (the source of 25% of all personal bankruptcies in the U.S.).

This is to be the focus of the new debate leading into the 2016 elections. This is to be the new direction for America. For decades Americans blithely trusted that Reagan’s tax cuts for the wealthy and deregulation would provide a path to prosperity for all.

We have seen how deregulation led to the massive economic crisis that capped the end of George W. Bush’s term in office. We have seen how under Reaganomics the immensely wealthy have vastly increased their wealth while the middle class has scarcely benefitted and the poor are even worse off than before. In the end Reaganomics generated a massive redistribution of wealth, taking from those who could least afford it and giving it to those who least needed it.

It is time to move back to the center, to restore prosperity for the middle class and provide greater opportunities for those who seek to join the middle class. It is time for America to go in a new direction. And Barack Obama is announcing that path.

The shutdown of government services in the United States is now well into its second week due to a continuing impasse between Republicans and Democrats over the Affordable Care Act (Obamacare). If the two parties cannot come together within the next seven days to raise the debt ceiling, America will face a catastrophic default on its national debt. So far, there has been little movement toward a resolution. Both sides have dug in their heels, and the public is getting worried.

Last Friday President Obama clearly stated that he would not negotiate with Republicans to end the budget standoff “with a gun held to the head of the American people.” He made a similar statement on Wednesday in a meeting with House Democrats saying he was willing to negotiate with Republicans but “not with a gun at my head.”

Republican House Speaker John Boehner has pounced on these statements repeatedly stating to the media simply that Obama “will not negotiate.”

On Wednesday the President tried to clarify his position by opening an hour-long press conference with the following extended statement:

This morning I had a chance to speak with Speaker Boehner. And I told him what I’ve been saying publicly, that I am happy to talk with him and other Republicans about anything – not just issues I think are important but also issues that they think are important. But I also told him that having such a conversation, talks, negotiations shouldn’t require hanging the threats of a government shutdown or economic chaos over the heads of the American people.

What the president said today was, if there is unconditional surrender by Republicans, he’ll sit down and talk to us.

In a nutshell, the situation boils down to this:

Obama: “Drop the gun, and we’ll talk.”

Boehner: “I’m not lowering my weapon.”

I have been thinking quite a bit in recent days about this “hostage” metaphor. If we were describing a similar hostage incident on our city streets, the police would have been summoned long ago, professional negotiators would be talking down the perpetrator, and the SWAT team would be in place to take lethal action if needed. Unfortunately, in American politics, there is no outside authority to intervene. There is no such police force, and there is no SWAT team.

De-escalating the Crisis

But there is the art of negotiation. Conservative commentator Jennifer Rubin observes the basic rule used by every SWAT team in hostage situations: “You might not give the hostage taker what he wants, but you start talking and may give him something to prevent him from doing great damage.”

Many people have called on President Obama to “throw Boehner a bone” of some kind to keep negotiations from breaking off completely. Perhaps this is that Obama was doing in his news conference when he announced,

I am happy to talk with [Boehner] and other Republicans about anything – not just issues I think are important but also issues that they think are important.

And it appears that the Republicans have taken hold of this offer. Many commentators have noted how

The GOP argument has shifted over the last week or so from seeking to roll back the president’s healthcare reform law in the fiscal showdown to seeking broader changes to the tax code and entitlement programs.

Many long-time Republican members of the House have been looking for a suitable exit strategy. John Boehner had originally tried to steer the Republican members of the House away from a confrontation over Obamacare, preferring to use the debt ceiling fight to push for further spending cuts. But he was overruled by the Tea Party caucus who insisted on following the strategy laid out by their de facto leader, Senator Ted Cruz.

Cruz has since been strongly castigated by other Republican members for overreaching his position and making grand promises that he could not keep. Rep. Peter King [R-NY] stated that he can “never forgive Ted Cruz,” and other Republicans have even circulated negative talking points against Cruz to prominent media personalities.

Others have expressed their disappointment with John Boehner who caved to the Tea party demands, demonstrating that even he finds himself being held hostage to Tea Party tactics.

Many Republican House members have expressed their frustration with having been pressured to join the Tea Party’s all-or-nothing assault on Obamacare. Charlie Dent [R-Pa] for one has gone on record as saying that strategy championed by Ted Cruz and a host of Tea Party congressmen has “failed miserably.”

But Tea Party members – and their outside funders and agitators – are not willing to back down. Robert Schlesinger of U.S. News and World Reportstates that

Heritage Action CEO Michael Needham told reporters Tuesday morning that grassroots conservatives will accept neither a pivot away from the issue in an effort to resolve the deadlock nor a short-term reopening of the government that doesn’t defund the law.

Finding an Exit Strategy

Is there any way out of this morass? Can House Republicans rally around a strategy that will enable them to emerge from this standoff with a win of some sort? Enter Paul Ryan, the House Budget Committee Chairman, who suddenly stepped forward this week to chart a new course for the House Republicans. Ryan had been keeping a low profile throughout the entire Obamacare standoff and subsequent government shutdown, letting others take center stage instead.

Then the day after President Obama announced that he would be willing to agree to a short-term extension of the debt ceiling if it were a “clean” extension (that is, without other conditions), Ryan stepped forward with a detailed plan reported in an op-ed in Wednesday’s Wall Street Journal saying “We’re ready to negotiate.”

Interestingly, his proposals do not mention Obamacare at all, focusing instead on “common-sense reforms of the country’s entitlements and tax code.” Today, Ryan headed to the White House for a meeting with the President along with 17 other Republican House members.

Many non-Tea Party Republican House members greeted Ryan’s entry into the fray with relief. “There’s nobody in the caucus that commands the respect that Paul does,” said one House Republican. Rep. Bill Nuizenga [R-MI] is quoted as saying, “The moderates trust him, they might not always like what he has to say but they trust him.”

The Tea Party and their backers, on the other hand, are outraged. Tom Kludt at Talking Points Memopoints out that

Right-wing groups such as the Senate Conservatives Fund, Heritage Action, and RedState.com immediately lashed out at Ryan for failing to include the death of Obamacare in his demands in exchange for not intentionally crashing the global economy.

They were joined by Amanda Carpenter, spokeswoman for Senator Ted Cruz, Ben Shapiro, editor-at-large at the right-wing Breitbart.com, and a long list of others.

But the popular base the Tea Party once enjoyed is now waning. As Fox News contributor Leslie Marshall noted in a strongly worded essay on Wednesday,

The Tea Party’s influence and following among the American population has plunged to the lowest point since it’s inception. Less than one in four Americans now back the Tea Party, according to a recent Gallup poll. And in that same poll, those who hate the Tea Party and oppose its tactics have greatly risen in number.

She continues,

If you break down the numbers, it’s perplexing why any Republican would forge ahead with the tea party’s shutdown. First: poll after poll shows the American people do not want this shutdown. Further, they do not want this shutdown over Obamacare. The polls also show Americans dislike a government shutdown more than they dislike Obamacare. Polls show the American people blame Republicans; even other Republicans!

The solution, in her view, is for the Republican Party to completely disassociate itself from the Tea Party and vice versa. “If you call yourself a party,” she says, then “become a party.”

It is time for the Republicans to reexamine what their party stands for. They are fast losing credibility with the public over this self-imposed budgetary crisis and the extreme unproductive positions taken so far. If they do not change course they, like the Tea Party they are currently beholding to, will speak only for a radical ostracized minority. Conservatism has a place in American politics. Radicalism does not.

In the late 1960s the Democrats followed an idealistic presidential candidate, Hubert Humphrey, who advocated progressive policy positions that the American public could not broadly endorse. The Party appeared to have capitulated to a radicalized core, and people abandoned it in droves. It took a lot of soul-searching, but eventually the Democrats reinvented themselves, under a more moderate banner of Clinton economics.

Republicans need to learn from that example. It may be a painful process – severing limbs (or removing cancerous growths) always is. But if the Party is to survive, it must be done.

On Tuesday President Obama delivered his first major follow-up address on job creation since unfolding his new economic plan for America in Galesburg, Illinois the previous week. [See my previous post on that speech.]

Obama spoke this time in Chattanooga, Tennessee at an Amazon.com Inc. mega-warehouse, where he praised the company for its initiatives in job creation. The site was a somewhat controversial choice since Amazon has previously been cited for abusive working conditions in its warehouses.

Much of the President’s speech repeated the same themes and language found in his earlier address in Galesburg, and we may expect more of the same as he brings his message to the other stops on his multi-city tour. But he did use the occasion to expand on the first of the five main cornerstones of middle-class security outlined at Galesburg, that of having a good job with decent wages and benefits. He also provided additional details on how he expects to get his job plan approved by Congress. And with a bit of additional research I have been able to piece together some of the maneuvering in the background that underlies his proposals.

Obama had previously announced a series of major employment initiatives in his February State of the Union address.He promised at that time that creating these jobs would not add to the deficit – that expenses incurred in creating these jobs would be offset by other revenues so there would be no net cost to individual taxpayers. The problem has been that Republicans in Congress have been adamantly opposed to approving any additional expenditures, even if they would be offset by other means.

Now the President believes he has found a way around this impasse. He stated on Tuesday,

I came here to offer a framework that might help break through some of the political logjam in Washington and try to get Congress to start moving.

He is even talking once again about a “Grand Bargain.” He is attempting to combine measures that he knows Republicans support with those he knows Democrats will support to achieve legislation that can receive broad enough bi-partisan backing to be approved by Congress.

In his address the President said,

I don’t want to go through the same old arguments where I propose an idea and the Republicans just say, no, because it’s my idea. So I’m going to try offering something that serious people in both parties should be able to support: a deal that simplifies the tax code for our businesses and creates good jobs with good wages for middle-class folks who work at those businesses.

Obama is resurrecting his plan outlined during the 2012 Presidential campaign to cut the corporate tax rate from 35 percent to no more than 28 percent through revisions to the tax code. Republicans are generally in favour of this reduction in tax rates, although they are far from agreement on other revisions to the tax code. Obama seems to be hoping that his proposal will encourage them to get moving on tax code restructuring – something that politicians on both sides of the aisle have been calling for. But there is still a problem. Republicans have insisted that all gains in revenue from closing tax loopholes must be reabsorbed in a lower overall tax rate. Changes to the tax code must not be used to provide any increased revenue.

The Obama administration has also called for the “repatriation” of earnings by U.S. companies that are currently being kept overseas and out of the reach of the IRS. Any recovery of taxes on this estimated $1.5 to $2 trillion in off-shore earnings would amount to a sizeable one-time windfall for the U.S. government. Measures to repatriate and tax these earnings (even at a substantially reduced rate) have broad support in Congress.

In 2004 the U.S. granted a “repatriation holiday” to corporations that returned earnings held overseas, and the business community has been lobbying for another complete tax holiday as the condition for repatriating their earnings once again. But there is considerable resistance in Congress to granting these corporations complete tax immunity on these amounts.

Ezra Klein notes, both the White House and House Republicans have settled on a compromise solution that would impose

a small, one-time fee on all deferred foreign earnings. This isn’t a tax cut for money corporations bring back. It’s a levy on all the money they have sitting overseas, and they pay it whether they bring it back or not. After paying the fee, that money is free and clear so far as the taxman is concerned.

The details of this one-time fee still have to be negotiated, but the President is proposing to use this money to fund a jobs program providing broad employment opportunities in the repair of roads and bridges, in education at community colleges, and in creating new industrial centeres for manufacturing.

Obama’s jobs creation proposal consists of linking these two measures: The president will support a Republican plan for revenue neutral changes to the tax code (eliminating tax loopholes and using the gains to lower corporate tax rates) if they will agree to let him take the additional revenue received from a separate one-time fee on corporate foreign earnings and apply them to his job creation program.

Here’s the bottom line: I’m willing to work with Republicans on reforming our corporate tax code, as long as we use the money from transitioning to a simpler tax system for a significant investment in creating middle-class jobs. That’s the deal.

The White House hopes the idea will gain some traction in Congress because Republicans want corporate tax reform and Democrats want spending for infrastructure, so this offers something for both sides.

We should note that Democrats have until now been opposed to the revenue neutral model of reforming the tax code, and want to apply the additional revenues resulting from these tax changes to funding enhanced employment and social programs. They do not want to see this increased revenue disappear again into other tax cuts.

So President Obama met with the Democratic caucus on Wednesday, explaining his proposals to them, and they have now rallied to announce their solid support for his jobs initiative.

The timing of this move has been carefully planned. This Friday Congress goes into summer recess, and both Republicans and Democrats will be returning to their home ridings to meet with their constituents. Democratic members of Congress will be promoting their strong support for the President’s jobs initiative and talking about their own “Make it in America” employment strategy. They will have a positive, hopeful message to bring to their constituents.

And what message will the Republicans be bringing to their constituents? What they have to report on so far is largely a negative campaign: nearly 40 attempts to repeat Obamacare, threats to shut down the government this fall by refusing to pay for current expenditures; the continuation of the sequester which the independent Congressional Budget Office estimates will cost the American economy 750,000 jobs this year and 900,000 fewer jobs next year? That may please their hard-core supporters, but it will not play well before a larger audience.

As the Congress prepares to go on summer recess, President Obama is putting the Republicans on the defensive. It will be interesting to see how this plays out.

This past week Barack Obama delivered his much anticipated speech on economic policy before an enthusiastic audience at Knox College in Galesburg, Illinois. It was the same place where he delivered his first major speech after taking office as Senator in 2005, and this speech had the same focus as on that previous occasion.

I came here to talk about what a changing economy was doing to the middle class and what we as a country needed to do to give every American a chance to get ahead in the 21st century.

The President explained that

In the period after World War II, a growing middle class was the engine of our prosperity. … This country offered you a basic bargain, a sense that your hard work would be rewarded with fair wages and decent benefits, the chance to buy a home, to save for retirement and – and most of all, a chance to hand down a better life for your kids.

But over time … that bargain began to fray. … The income of the top 1 percent nearly quadrupled from 1979 to 2007, but the typical family’s incomes barely budged. And towards the end of those three decades, a housing bubble, credit cards, a churning financial sector was keeping the economy artificially juiced up … .

But by the time I took office in 2009 as your president, we all know the bubble had burst. And it cost millions of Americans their jobs and their homes and their savings. … And the decades long erosion that had been taking place, the erosion of middle-class security, was suddenly laid bare for everybody to see.

However, he continued, “America has fought its way back.”

Over the past 40 months our businesses have created 7.2 million new jobs. This year we’re off to our strongest private sector job growth since 1999. … We sell more products made in America to the rest of the world than ever before. … The cost of health care is growing at its slowest rate in 50 years. And our deficits are falling at the fastest rate in 60 years.

Looking Back

Five years ago the main concerns in the midst of the economic crisis were the exploding national debt and the expanding budget deficit – leftovers from the Bush presidency that Obama and Congress had to contend with. Calls were made for strict austerity measures, slashing government spending and maintaining low taxes. Stimulus measures, which would increase government spending, were argued against. Spending was reduced. A sequester was imposed. And Obama’s proposals for new spending on infrastructure, renewable energy, and education were beaten back.

The economic measures taken at that time were defensive in nature. They were meant to stave off economic collapse, and they worked. America successfully steered away from the brink of disaster. Now the crisis has passed. But the thinking remains the same. Congress continues its austerity mindset with calls for even further cuts in aid to needy families, education, health care, and other areas. But austerity does not create jobs. Cutting support to the needy does not get them spending more money.

The economy has turned the corner. Improvement has been slow but steady. While unemployment is still high, job numbers are going up. Housing prices have stabilized. Manufacturing has increased. The banks are strong again. And the stock markets have recovered. Americans cannot afford to allow these hard won accomplishments to come unraveled.

Changing the Conversation

America needs to move forward. Rather than focusing on the strategies of the past, the country needs to develop new strategies for a successful future. It will require a new way of thinking. As President Obama stated in his address his week,

What we need is not a three-month plan, or even a three-year plan. We need a long-term American strategy based on steady, persistent effort to reverse the forces that have conspired against the middle class for decades. That has to be our project.

In his address President Obama outlined five main cornerstones of middle-class security: 1) a good job with decent wages and benefits, 2) a good education, 3) a home of your own, 4) retirement security, and 5) health care security.

Those expecting to find a set of detailed proposals under these headings may have been disappointed. The details will be unveiled in a series of further addresses over the next several weeks as the President takes his case “on the road” to present it to the American people. This first event was intended to merely set the stage for those presentations and to provide what the President referred to as “a quick preview of what I’ll be fighting for and why.”

Ezra Klein, writing in The Washington Post, argues that Obama’s speech is intended to signal a major “pivot point” in the nation’s discussion of the economy. The President is attempting to shift the focus from the strategy of “trickle-down” economics, which has been utilized since the 1980s and has enriched the wealthy but actually shrunk the middle class, to what he calls a “middle-out” expansion of the economy.

Good jobs, a better bargain for the middle class and the folks who are working to get into the middle class, an economy that grows from the middle out, not the top down, that’s where I will focus my energies … not just for the next few months but for the remainder of my presidency.

Two major studies prepared over a decade apart by the World Bank and the International Development Fund have empirically shown the superior benefits of economic policies that primarily benefit the middle class. However, the Republican members of Congress are almost sure to oppose Obama’s new economic plan, and the President recognizes this. So he is calling on these members to present their own alternative proposals for boosting the economy. “It’s not enough for you to just oppose me,” he says. “You got to be for something. What are your ideas?”

If you’re willing to work with me to strengthen American manufacturing and rebuild this country’s infrastructure, let’s go. If you’ve got better ideas to bring down the cost of college for working families, let’s hear them. If … you think you have a better plan for making sure that every American has the security of quality, affordable health care, then stop taking meaningless repeal votes and share your concrete ideas with the country.

Repealing “Obamacare” and cutting spending is not an economic plan. It’s not. If you’re serious about a balanced long-term fiscal plan that replaces the mindless cuts currently in place, or if you’re interested in tax reform that closes corporate loopholes and gives working families a better deal, I’m ready to work.

The President is attempting to shift the conversation in a new direction and chart a new course for the future. In the weeks to come he will unfold the details of his five cornerstones to economic growth for the middle class. We will also see if his Republican opponents have any substantive counter proposals to put on the table. Or perhaps they will simply continue to decry his ideas without presenting constructive proposals in return.

Edward Clayton grew up in the US but has lived in Canada for the last 4 decades. He is a long time peace activist and committed to issues of social justice and good government. He reports on Canadian, American, and global politics from a Canadian perspective.